Stocks slip as jobs data dents hopes of Fed easing up

Reuters Videos
Updated
2

STORY: U.S. stocks closed lower for a second straight session on Tuesday after data showed job openings unexpectedly rose in September, suggesting that demand for labor remains strong despite the Federal Reserve's interest rate hikes intended to cool demand and bring down inflation.

That dimmed investor hopes the central bank might ease up on its aggressive plan.

The Dow fell about a quarter of a percent. The S&P 500 lost four tenths of a percent, while the Nasdaq ended slightly less than a percent lower.

Tyler Ellegard, investment analyst at Gradient Investments, said Tuesday's strong labor market data - known as the JOLTS report or Job Opening and Labor Turnover Survey - "solidified" an expected 75-basis-point rate hike from the Fed on Wednesday.

"There's a lot of uncertainty still. You still have the Federal Reserve. They're meeting this week. So, we'll have that decision here shortly. So, you know, the market's anticipating a 75-basis point hike. I mean, at this point, there's no reason why they wouldn't with all the different economic items that they've had. And then the JOLTS (Job Opening and Labor Turnover Survey) report today, I think also solidifies that 75 basis points. So, I think the market is just trying to figure out what or waiting in anticipation of what the Federal Reserve is going to be doing later this week."

Shares of megacap growth names such as Amazon and Apple, which have struggled since the Fed began raising interest rates, were once again under pressure.

Pfizer rose after the drugmaker raised its full-year sales estimates, while Eli Lilly fell after trimming its profit forecast.

And shares of Uber surged after giving an upbeat fourth-quarter profit outlook, which also lifted shares of rival Lyft and food delivery service DoorDash.